55   I can talk about finance

A    Financial terms

Example  

Meaning

We need to raise capital.  

capital  the money you need to start a business (to raise capital is to find the money you need).

The company has an annual turnover of $20 million.  

turnover  the total value of goods or services that a company sells in a particular period of time (annual = every year). SYN sales revenue.

Operating costs have gone up this year.  

operating costs  the amount of money that a business needs to spend to continue as a business.

Inflation is now at 3 per cent.  

inflation  a general rise in the price of services and goods in a particular country.

We paid £1 million in tax.  

tax  money you have to pay to the government.

The company made a pre-tax profit of £2 million.  

profit  the money you make in a business after paying costs (pre-tax is before paying tax). OPP loss.

I think the company has cash flow problems.  

cash flow  the movement of money into and out of a business (a cash flow problem means more money is going out than coming in).

I need a bank loan.  They took out a loan.  

bank loan  money the bank lends and sb borrows. 

take out  obtain (you also take out insurance).

We pay a lot of interest.  The interest rate is 4 per cent.  

interest  extra money you pay when you borrow money (the interest rate is the exact cost of borrowing).

 

spotlight  finance

Finance can be:

1    the money somebody borrows or receives to operate a business (They need to raise more finance.) finance V.

OR

2    the activity of managing money in a company. financial ADJ. (He’s the new Director of Finance /Financial Director.) 

3     Test yourself. Look at the examples and cover the meanings. What do the examples mean?

 

B    Financial trends

Adjective            

Meaning             

Adverb

a slight rise in costs  

very small.  

Costs rose slightly.

a gradual rise in profits  

slow and over a long period of time.  

Profits have risen gradually.

a steady increase in the interest rate  

slow but regular and continuing.  

The interest rate has increased steadily.

a significant fall in profits  

noticeable and important.  

Profits fell significantly.

a sharp fall in sales  

very large and sudden.  

Sales have fallen sharply.

4     Complete the sentences on the right. The meaning must stay the same.

►   There has been a sharp fall in sales. Sales have fallen sharply.

1     There was significant growth in sales.   

Sales ________.

2     There was a gradual rise in the price.     

The price ________.

3     There was a slight fall in profits.            

Profits ________.

4     There has been stability in costs.            

Costs have remained ________.

5     There has been a steady rise in sales.     

Sales have ________.

1     grew significantly; rose significantly

2     rose gradually

3     fell slightly

4     stable; unchanged

5     risen steadily

6     Look at the arrows and complete the sentences.

 

1     rose slightly; went up slightly; increased slightly; grew slightly

2     sharp rise; sharp increase; sharp growth

3     remained stable; remained unchanged; stayed stable; stayed unchanged

4     fell slightly; dropped slightly; went down slightly

5     fell sharply; dropped sharply; went down sharply